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Technological Underpin for EACOP Explained

Created by: UCMP on February, 2023


Technological Underpin for EACOP Explained

The East African Crude Oil Pipeline (EACOP) continues to suffer criticism from opponents who are making allegations about environmental and social issues affecting the Project Affected Persons (PAPs). On January 15th, Mr. Martin Tiffen, EACOP’s Managing Director explained to the public what the project is during a Twitter space hosted by Discourse Africa’s  Elison Karuhanga.

What is EACOP?

Tiffen: EACOP is a physical system that begins from Kabale in Hoima and ends 1,443 km in the port of Tanga in Tanzania. It is a buried pipeline. There are also some pumping stations in Tanga. In addition,  there will be tanks to hold the oil produced from Tilenga and King Fisher Project areas. 

EACOP is also a company with shareholders – a legal entity whose purpose is to build and operate the EACOP. It has four shareholders: TotalEnergies, Uganda National Oil Company (UNOC), China National Offshore Oil Corporation (CNOOC), and the Tanzania Petroleum Development Corporation (TPDC).

EACOP has become a bit of a symbol – a conduit to bring the oil produced in Uganda to world markets.

There are concerns about Uganda’s shareholding. Could you explain the shareholding structure to the public?

Tiffen: In the upstream, we have a long-standing agreement -the Production Sharing Agreements between the government of Uganda- the owner of the resources. Uganda has also entered into agreements with CNOOC, TotalEnergies, and UNOC. The PSAs detail how the oil will be shared once it is produced. EACOP takes custody of the oil, but it is never the owner. It is important for the government of Uganda to be represented in the EACOP. The value of the oil remains upstream and that is where the government of Uganda will make its revenues. 

Each barrel of oil will pay a tariff for shipping through the EACOP and that is how EACOP will make its living, but the real value and margin will remain with the upstream and will be regulated under the upstream  PSA. 

How is the EACOP designed and what makes it special technologically?

Tiffen: Pipelines are good means for transporting crude oil. But there are alternatives -by-road tankers carrying products. EACOP will be a buried pipeline and it is basically a cumulative experience of building and operating a pipeline,  which is captured in Engineering Design Codes. EACOP will be designed in an API  Code, an American Petroleum Institute Design Code. They dictate how we design many aspects including the thickness.  The codes impose basic and simple but very effective measures. One of the key dictates is when we build the pipes, we weld the pieces of pipes and before we admit any oil into the pipeline we do pressure tests/ hydro tests. We fill the pipeline with water and pressure tests at 125% of its maximum operating pressure, which is industry standard. That is a good check of the integrity of the pipeline system. The pipe is broken into sections and isolated by block valves 76 along the length of EACOP so roughly at every 20 km there is a valve controlled from control rooms and they can be closed. If anything happens, you can limit it to 20 km.

EACOP will have modern technology which is not yet industry practice but will have fibre optic cables laid. This allows the operator to control the pipelines from one end to the other which is necessary. Fibre optics can do a number of clever things 1- use the fibre optics to monitor the temperature along the pipeline and, the second use is for monitoring vibrations. The interesting thing about temperature for example,  if there are floods and the topsoil is washed off and the pipeline is exposed to air, then the temperature will drop, and will be in a few minutes we will be able to detect the temperature change and located within 10 km length where pipeline dropped the temperature and we remedy the situation. 

Vibration monitoring- it is more sophisticated because there will be many things moving along the pipeline (cars, people, animals) and so we need a system that can learn to distinguish the noises. The two systems give us effective eyes and ears along every linear meter of the pipeline, which is not standard in recent years. Many of the older pipelines do not have that monitoring capacity. 

Does that mean that all the time there is a problem the valves will just close? 

Tiffen: The valves are remote-controlled and the centre will be manned 24/7 at the operating centres. They will be at the pipe inlet so they can coordinate with the production coming in from Tilenga and King Fisher and one at the terminal in Tanga so they can coordinate the ship movements at the ports. With fibre optic cables they will have data the whole length of the pipeline and each one will see any problem from A-Z including any potential danger or anomalies coming from vibration and temperature detection systems. There is also.  CCTV will be placed in certain locations and other monitoring systems will be in place.    

We have one line of fiber optic cables coming from Mombasa. Saying that EACOP will have all these cables is there a possibility to give some data for in-country use?

Tiffen: The government of Uganda is doing a survey with telecoms for 297 Km to see where EACOP will cross existing fiber optic cable, which could be either government or a telecom company. The principle of the internet is to use signals and that can be rooted in many ways. The more ways, the more robust the network will be. So when the internet drops along one route we can repute it quickly.  We have agreed that if there is some spare capacity, we shall lay up to 96-core fiber optic cable and that will be more than what is needed by EACOP. We have agreed to make available the capacity of the fiber optic and that is a price for both Uganda and Tanzania -they have the opportunity to make their network more robust.

There are allegations that EACOP will cross 230 rivers and how do we ensure that the Pipeline will not adversely affect the environment?

The way of a pipeline is to control contamination of the fluid in the pipe with the outside environment. It doesn’t really matter whether it crosses a farm, river, or wetland. Along the pipeline root, 92% is crossed on land occupied by humans and 8% is other designated areas that include tiny water crosses, flooded areas, seasonal rivers, wetlands, and two major rivers; Kagera in Tanzania and Sigi River near Tanga. The two rivers will be crossed by Horizontal directional drilling – which means having a slanted drilling rig that will drill a hole beneath the river bed 30 meters below and pull the pipeline along the horizontal drilling machine. It is a standard way of crossing rivers, motorways, and rail lines.   

We have wetlands in Uganda and the idea is to bury the pipeline below the wetlands. The pipeline will be far less intrusive than roads on wetlands.  

Can you describe it further…

Horizontal drilling is like a micro tunnel, not big enough for human beings to cross but enough for the pipeline that will be sitting on a steel liner. So with horizontal drilling, we can go between 1 km and 2 km between the entry point and exit point. The pipelines will cross the wetlands in Uganda from the bottom and once closed the pipelines will be totally invisible.   

What are the impacts of EACOP on biodiversity and does it cross National parks, and game reserves, forests …

Tiffen: In 2016 there was a decision taken by East Africa Community that Ugandan oil will be routed using the Tanzania route. We studied the route in detail using a methodology that is well-established and compliant with the performance standards of the International Finance  Corporation (IFC), the most stringent guideline. We have a philosophy called- Avoid, Minimize Restore, and Offset. To the greatest extent possible, we avoid any of these areas, where it is not possible we minimize the impacts. So for the pipeline, we shall store the topsoil and once the pipeline is buried, then the topsoil will be put back and the vegetation will regrow. It was two years of work with national environment authorities in Tanzania and Uganda.

We narrowed the route progressively from about 10 km to 2 km, then narrowed it to 100 meters, and finally to 30 meters for construction works. We avoided slopes. Also, the technical constraints like the soils, the rocks we lose, and environmental and social constraints on the road, households, farms and that is how we applied the philosophy.

92% of the EACOP route has been impacted by human activities, while 8% goes through designated areas. None of those areas are IUCN classified. It passes where the land is managed by the National Forest Authority (NFA), is largely Eucalyptus used for commercial foresters, and is encroached on by people.   

In Tanzania,  30% of the surface area is designated forest reserves, hunting areas, and national parks. When the line was routed it didn’t go through national parks but it did go through some designated areas. The idea was to go through very close to the boundaries of those designated areas, which are being impacted by human activities e.g the swagaswaga game reserve is heavily impacted by human activities, but there are fewer people. There is one area in the corner of South Western corner of Lake Victoria which has been re-designated – and that is a very nascent park. We are in discussions with Tanzania national park authority to see whether we c help support some basic management plans.  That one, we can avoid because it goes all the way to Lake Victoria to the border with Rwanda,  and Burundi. We did intensive work on micro-rerouting, taking measures to avoid individual impacts. The main road from Tanzania goes through Kagera and that is exactly the same area already crossed by road which has been there for decades.

Does EACOP have impacts on people?

Tiffen: This is a subject of much debate and also a degree of missing some realities and numbers. The unit of measurement on land on people is called the Project Affected Persons, or households. We have two types of PAP( those whose land has been partly impacted and those whose whole land has been impacted). Physically displaced are those whose primary dwelling is on the land for the project. In Uganda, there is 297 km of the EACOP route and we take a 30 km wide strip of land along that stretch so we go across people’s land the majority are cultivated and have structures and trees. In Uganda, we have 3,648 households of that 203 households are those whose primary dwellings have been impacted. 

Our obligation is, will relocate those people and they have choices; replacement housing or cash compensation. We visited each of the 203 impacted households and we asked them if they wanted compensation in cash or replacement housing. Almost 90% have opted for replacement housing and so now we are building 179 houses. We shall start handing over the houses this February, and mid-this year all those houses will be built and people will be relocated. 95% of those whose farms have been impacted by principle, under the local laws, should be compensated at full replacement value. We have inventory valuations and now the teams are in the field signing compensation agreements with impacted households. By early  2023, we signed agreements with almost 805 households in Uganda. We have helped households with opening bank accounts and financial literary training and made payments. Only then will be accessing land. We shall give people 90 Days to vacate.

In Tanzania, we have a similar process under the laws and regulations of Tanzania and IFC standards. Tanzania has 9,500 households impacted,  331 are physically impacted, and have been given options for resettlement of replacement houses. More than 80% have chosen replacement houses and we are building 300 replacement houses and some have been handed over already in mid-2022. The process in Tanzania is at 95% complete while in Uganda about 80% complete. But we are on track in both countries in land acquisition. That is one of the prerequisites for work on the ground- to see all acquisition process is completed properly. 

Is land being compulsorily acquired?

Tiffen: We are not using legal mechanisms for compulsory land acquisition. We have a grievance mechanism and so if a household has an issue with evaluation, they can record the grievance, and steps are taken to resolve it. Everyone has signed agreements freely.  

What happens in case of an oil spill in spite of all the precautions?

Tiffen: That is part of our responsibility as the producer and transporter of oil and gas. We have a contingency plan in place. We have taken precautions to isolate the pipeline into sections, so it basically stops the flow and that reduces the inventory that can be released into the environment. An Oil Spill Contingency Plan is standard in all oil and gas operations and there are also international corporations on how to manage any spill be it in production, or transportation in order to be able to deploy resources in coordination with the authorities and to be able to clean up any area affected by the pollution. 

It is a huge exaggeration that 60 million people live around Lake Victoria. I can’t say there will never be an oil spill, but if it occurred it will be stopped very quickly and the volume will be very small,  and we have the means in place to clean up. 

What informed the decision for pipeline route selection?

Tiffen: There were 3 routes: Lamu and Mombasa in Kenya and Tanga in Tanzania. The three routes were evaluated in terms of feasibility, impact, and costs. Basically, the best route choice was Tanga.  The Mombasa one would mean going through Nairobi and Mombasa routes that have a lot of people and that would have had a very high impact on people. The Lamu route would be going through the harsh countryside, so there was the remoteness issue. 

What are the opportunities for local businesses?

Tiffen: Projects of this nature anywhere call for capacities in goods and services from around the world. It has a lot of international and local components. Since it is happening in Uganda and Tanzania, there is a lot of focus from local authorities and business communities to ensure National Content/ Local Content. So we have a process of unbundling for local goods and services and that gives opportunities for small businesses.  In Tanzania, we are working at the moment in the area where the coating plant is going to be established, camps and people yards, and civil works are being done by local companies. Similarly in Uganda, there is huge surveying, mapping, measuring, and land acquisition opportunities. We are mobilizing international skills, but they require logistics like camps which are provided by local companies.  We have a number of expatriates, but we also have a big focus on recruiting and training Ugandans and Tanzanians We have a commitment that whatever can be done locally we will do it locally.

Going forward, there will be construction activities in the second half of 2023. There are still plenty of opportunities that lie ahead including training for Ugandans and Tanzanians. 

Closing remarks…

Tiffen: EACOP took a decision that signing for compensations will be done at the level of households and not to any individual. We have a contract with Centenary Bank to open bank accounts in joint names of the spouses or persons signing for compensation and that is the best practice. We are committed to being transparent and to being visited.  

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